Global Standards for the world economy

Tuesday 15 October 2019

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Investors in Financial Reporting

What we need and what we have to offer


What we need

 

Leading the profession

Signing up to the Statement of Shared Beliefs enables leading voices within the global investment community to make visible their:

  • own commitment to improving financial reporting;
  • belief that high quality financial reporting standards are a collective responsibility; and
  • belief that this is a debate so fundamental to the efficient running of capital markets that it should be viewed as part of the day job of any responsible investor.

As part of being a responsible investor and improving the quality and usefulness of financial reporting, investor organisations that sign-up to the Statement of Shared Beliefs agree to the following:

  • ongoing dialogue: senior representatives will meet with Board members or senior staff on a periodic basis to discuss high-level issues that are relevant to investors and financial reporting, and to review opportunities to improve the Board's interaction with their investment teams.
  • executive level support: senior management (for example, Chief Investment Officers or Heads of Research) will provide executive-level support for their organisation’s participation in the development of high-quality global accounting standards. This comprises encouraging their analysts and portfolio managers to see engagement with the Board and staff as beneficial to their day-to-day activities and formally supporting them in taking the time to understand how accounting requirements are changing. This also includes encouraging these investors to share their thoughts on the financial information that they need.
  • access to analysts and portfolio managers: to streamline engagement with the Board and staff, organisations will provide a point of contact within the firm or territorial cluster. This will help the Board and staff to disseminate education materials to the right teams, to introduce us to those who are most likely to be affected by a change in reporting, and to ensure that we hear any suggestions for change from those most affected.

We hope that the leadership of these organisations in the first phase of the programme will encourage others within the investment community to join the financial reporting debate.

What we have to offer

 

We see engagement with the investment community as a two-way street. As well as continuing to seek the views of investors, considering them carefully and giving them due weight in the standard-setting process, the Board has committed to:

  • providing the buy-side community with an improved channel through which to influence our Standards.
  • developing investor-tailored webcasts on changes to our Standards as well as on key details about the Standards and how they might affect the information that investors receive. The webcasts aim to raise the levels of awareness and understanding among investors about proposed changes in accounting requirements, and are produced separately by the IASB staff as well as being developed in conjunction with the CFA Institute.
  • providing investor-friendly articles on our proposed changes. These articles are written by Board members and aim to summarise the key points about any new proposal or Standard in an ‘investor-friendly’ way.
  • providing access to IASB members and staff who can provide updates to the organisations’ analysts and portfolio managers on the potential impact of new Standards, especially those related to certain sectors or jurisdictions.
  • providing a contact person to discuss any suggestions that analysts have on existing disclosures or proposed changes to our Standards or introduce them to the related expert in our organisation.
  • providing investor-focused education sessions for analysts and portfolio managers on current projects, new Standards, and/or existing Standards. In addition, we will notify investor organisations of any new changes to our Standards and endeavour to highlight any industries that might be ‘disproportionately affected.’

 

Related information

 

Contact


Fred Nieto

Principal, Head of Investor Engagement
fnieto@ifrs.org